Address to Ai Group - Industry Meets Canberra

** Acknowledgements omitted **
 

I want to start by acknowledging that there have been very significant changes to the workplace relations framework since we came to government.

But there needed to be.

It’s hard to imagine another time when our country’s wages policy has been more important.

Ten years of Coalition government - for whom low wages were a deliberate design feature of their economic policy - meant wages were not keeping up with inflation, leaving working Australians falling further behind. And it wasn’t helping businesses, with the 2010s producing the worst decade of productivity growth in 60 years.

It is inescapable that the cost of living is the most pressing issue across the country.

And the fact is you can’t address the cost of living without lifting wages.

We went to the election saying we would get wages moving again, and we’ve begun the job.

Our workplace relations approach is about ensuring that all workers have reasonable access to minimum standards in their workplaces, while also assisting businesses to grow.

It’s about supporting more agreements, more wages growth and more productivity, not more conflict.

Our changes have been the most significant to the Fair Work Act since it was introduced.

We have:

• Criminalised intentional wage theft
• Stopped the underpayment of workers through the inappropriate use of labour hire
• Introduced a framework to set minimum standards for gig workers and truckies;
• Introduced the right to disconnect to stop unpaid overtime, and;
• Made gender equality and job security objectives of the Fair Work Act.

We took steps to reinvigorate bargaining, by:

• Simplifying agreement approvals,
• restarting bargaining for expired agreements,
• making the Better Off Overall Test simpler and fairer, and
• giving the Fair Work Commission more power to arbitrate and to resolve intractable bargaining.

These changes have got more employers, unions and workers sitting round the table, cooperating, to reach agreements that work for them.

That would be one of my key reflections in this role – that despite the commentary, the vast majority of these changes have come through cooperation and collegiality and I appreciate the important role Ai Group and your members have played in that.

The evidence is in and it shows that our changes are working to grow wages.

The latest quarterly Wage Price Index showed wages were up 3.5% for the year to September 2024.

And most importantly, real wages are on the rise, with wage growth outstripping inflation for four consecutive quarters.

In stark contrast, real wages were going backwards by 3.4 per cent, and went backwards in the five quarters leading up to the last election.

Our changes have been backed up by the independent experts too.

An independent interim review report released last week found that the Albanese Government’s Secure Jobs, Better Pay Act reforms "are, on the whole, achieving the Australian Government’s intent, operating appropriately and effectively and with minimal unintended consequences”.

The independent reviewers found that, since the passage of the reforms, “collective bargaining is increasing, especially the coverage of collective agreements, and wages (and other indicators of workers’ economic circumstances) have started to improve”. We promised to get wages moving again, and it’s starting to happen – a vital step in helping Australians cope with the global inflation surge we’ve all been through.

Submissions are now open on the interim report, due by 16 February, with a final report due to be provided to Government no later than 31 March and I’d encourage your members to be involved.

What we have also shown though, is that we can grow wages, while keeping the economy strong.

Inflation is down, wages are up and unemployment remains low.

Inflation is down - over the twelve months to the December 2024 quarter, the CPI rose just 2.4%. The lowest annual inflation rate since the first quarter of 2021 and an extremely significant decrease from what we inherited.

Unemployment remains low at 4%, with employment continuing to increase in the last quarter and more than a million new jobs created since we came to government. Importantly, while we have created important jobs in the care sector, four out of five of the 1.1 million jobs we’re created have been in the private sector, with more jobs created in the market sector than any first term Australian Government.

The number of workers covered by agreements is up with an extra 933 enterprise agreements in the September quarter 2024, covering more than 340,000 employees. 

That means enterprise bargaining has positively impacted 1.26 million employees across both the public and private sectors over the last 12 months alone – the highest number of workers covered by new agreements in any 12-month period on record. 

Our Government believes that enterprise agreements are good for workers and good for businesses.

Workers get better pay and conditions, and businesses get more flexibility and productivity. 

This is demonstrated by the fact that productivity is up – with data released at the end of January by the ABS showing that in 2023-24 market sector labour productivity increased 1.1%.

And this more cooperative approach has also led to less industrial action.

The ABS also shows that days lost to industrial action is down under the Albanese Government - the average time lost to industrial action per quarter is now 2.0 days per 1,000 employees, compared to 2.4 days under the former Government.

So for those who say we can’t deliver wage rises without jeopardising the economy or business growth, the facts show otherwise.

What I hope you’ve also seen is that we’re also a government that is not afraid to intervene where we need to.

And on that note, I can only reiterate we remain committed to addressing the allegations of criminality and corruption in the construction industry.

I thank the Ai Group for its constructive engagement in the process of passing legislation to enable the appointment of an administrator to the CFMEU Construction Division.

Now – this was the strongest possible action the government could have taken to address the serious allegations of unacceptable behaviour.

The administrator and his team have a very difficult job, but the feedback I receive from employers and unions alike is that things are already starting to change, to reform this important industry’s culture.

The choice at the next election is between a Labor government which has more than halved inflation, while lifting wages and rolling out cost‑of‑living help versus Peter Dutton and a Coalition which would make things worse for the average Australian, not better.

I understand that some in the business community aren’t thrilled about our workplace relations reforms and some are supporting the types of changes being promoted by the Coalition.

But remember, that in keeping wages low, the Coalition also delivered lower productivity, higher inflation, lower employment and more industrial action in our workplaces.

Unlike our opponents on the left and right, we’re prepared to work with all stakeholders and make the tough decisions needed to deliver fairness and prosperity across the economy.

I might leave it there, but once again thank you for the opportunity to speak to you all today and I look forward to your questions.